Identitii Launches $11 Million IPO on Australia Securities Exchange (ASX)
Fintech Identitii Valued At $11 Million As It Launches IPO On Australia Securities Exchange (ASX)
We are used to the idea of initial coin offerings (ICO’s) in the distributed technology world, and not much on blockchain related companies launching IPO’s to raise capital for further development. The latest company to join the traditional system is Australia’s blockchain company Identitii. The company becomes only the second company to launch its IPO at Australia’s largest exchange, Australia Securities Exchange (ASX).
A lot has been written an explained on initial coin offerings relating to blockchain technology and cryptocurrencies. This is a new method used by blockchains to raise capital and additional funds for development through offering coins in a public or private sale. Typically not the old school IPO equity business where you own part of the company, in ICO’s you own a digital asset that has a specific use case and can be traded on exchanges.
The overall global blockchain industry is estimated to grow to $7.6 billion USD by 2022, representing a CAGR of 79.6% from the current market of $414 million USD. This is set to capture both the blockchain projects and the companies in the field.
The latest interest in blockchain companies launching IPO’s seems to have slowed with most companies’ value dropping in the last few days with the massive sell off in cryptocurrency assets.
The Numbers Behind The IPO
With the company facing huge losses last year and at the start of the year a decision was reached to raise more capital from the public to develop the company’s technology and continue its day-to-day operations. A total of $11 million USD is set to be raised through the sale of 14 million shares on ASX at $0.75 USD per share.
With a total of 25% of the company’s shares up in the IPO, the company is set to be valued at $44 million USD at the market. A third of Identitii’s shares will be taken up with the top executives at the firm, Nicholas Armstrong, co-founder of Identitii with 17.2% of the shares. The rest will be owned by Eric Knight and Thomas Roche, 8.7% and 5.6% respectively.
The distribution of the funds will see $4 million USD raised towards the marketing and development of the Serra platform, Identitii’s anti money laundering blockchain solution. Research & Development and the IPO fee to ASX will each need $1 million USD, an office-fit out at $640,000 USD and the IP protection fee at $120,000 USD. The fees mentioned are however face a heavy obstacle in finding investors as the company recorded losses for the past year and the start of the year. The company is not yet profitable and shows the $1.9 million USD loss last year and forecasts of $3.2 million loss this year.
Other Blockchain Projects On ASX
The mobile gaming blockchain Animoca Brands (ASX:AB1) has seen its price fall by $0.2 USD since 2014 after its operational switch to mobile gaming and saw the price rise by 777% in 2017. Digital X (ASX: DCC), a consultant company in blockchain technologies and cryptocurrencies, has increased by over 400% in 2018. The company launched its shares last year in August and has a current share price of $0.16 USD.
Identitii launches the ‘Know Your Transaction’ unique identity that will allow banks and other financial institutions develop their transaction systems as they move from the traditional KYC/AML methods. Identitii allows financial institutions to enrich payment messages with detailed information about actors and purpose.